Best Books for Finance Majors

As a finance major, your b school will teach you many things, but many others will still be left out. You may learn many tools and techniques but may still miss out on the situational context of the world of finance. This situational context- what works the best under what circumstances, which tools make for the most practical ones in the real world- can only be taught by someone who has lived in this context for most of his life.

So, here are the 8 best books for finance majors, written by top-notch finance professionals worldwide. Based on user reviews, this list constitutes a set of books that a finance major from any university must read to become a wholesome package for the real world and his career as a finance professional.

Rich Dad Poor Dad

Author: Robery Kiyosaki

This book might be familiar to most of you. This book was written way back in the 1990s, and yet there is no replacement for this book even 20 years later. You truly cannot see your assets and liabilities in the proper light before reading this book. So then, what is the point of being a finance major if you do not get the basics right? In this book, Robert Kiyosaki will deny some of the things you learn in your finance classrooms and will add and complement the value of some others. Sharing his personal story with the reader throughout the book, this book will also give you the confidence to succeed and still not push you into boredom. No doubt, this book makes for the best book on finance majors.

Saving Capitalism from the Capitalists

Author: Raghuram Rajan & Luigi Zigales

In my opinion, Saving Capitalism from the Capitalists deserves nothing less than 5 stars, especially when considering students coming from finance majors. Written by renowned authors Raghuram G. Rajan and Luigi Zingales, this book can be considered a major course on finance. Do you know why, and more importantly how, capitalists protect their interests using capitalism as a shield? Did you know that too much profit and idle cash can, and have many times, led to corporations’ downfall? Do you know how insurance companies themselves need insurance coverage and how they do so? To get all these answers and learn many more things about the world of finance, read this book. Whatever topics this book touches, it will guarantee an in-depth understanding of how, what, and why of them.

The author does not go against the idea of capitalism; in fact, they defend it in this book. They first discuss how capitalists use capitalism to protect their vested interests and promote inequality. Later, they themselves defend capitalism and present how capitalism and the right financial institutions bring efficiency into the markets and lead to the economic growth of nations. This book is not just one of the best books for finance majors. Instead, it is a must-read for finance majors.

Barbarians at the Gate

Author: Bryan Burrough & John Helyar for Wall Street Journal

Barbarians at the Gate is written by investigative journalists Bryan Burrough and John Helyar based on a series of articles they wrote for the Wall Street Journal. Came across the term ‘Leveraged Buyout’ in your finance course? Well, you will know its real-world meaning in this excellent masterpiece. The whole book revolves around the story of the acquisition of RJR Nabisco and the sins of the characters.

The Intelligent Investor

Author: Benjamin Graham

A masterpiece trending on the bookshelves for years, wisdom flows throughout this heavy book on investing. A bit difficult for beginners to understand. This book should be read by true and long-term investors, not speculators. If you have learned the science of investment in your college, learn the art of investment here. This will help you build the right attitude and the right character you need to have as an investor.

A Random Walk Down Wall Street

Author: Burton G Malkiel

A random walk down Wall street, written by Burton G. Malkiel, is a masterpiece on stock market investment. Whether you are an investor or not, as a finance major, your studies will be incomplete without a deep understanding of the stock market. And to give that deep understanding, no other book can beat this. Burton writes how investors keep investing in stocks that are overpriced in their intrinsic value, dreaming that the value will go up in the future. He shows how technical analysis does not work, as yesterday’s price movement of stock has zero correlation with today’s or tomorrow’s price movement. To quote one of the most rousing lines from the book, Burton says:

“It is not hard to make money in the market. What is hard to avoid is the alluring temptation to throw your money away on short, get-rich-quick speculative binges. It is an obvious lesson, but one frequently ignored.”

– Burton G. Malkiel

The Richest Man in Babylon

Author: George S. Clason

In The Richest Man in Babylon, the author George Clason shares some timeless principles of financial success, which originated from the ancient city of Babylon. The wisdom of financial success is conveyed through short stories as a conversation between the characters. The inability of a normal person to earn and save money and the tips to overcome this inability form the basis of this book. One of the best things about this book is that it is highly relatable to those struggling to become financially successful. The issues and the solutions are highly practical and in a very simple language.

The Alchemy of Finance

Author: George Soros

The list of best books for finance majors shall be incomplete without this book. The book explains the crux of the author George Soro’s investment philosophy, the president of the highly successful Quantum Fund. This book accounts for how he formed his investment philosophy based on the several macroeconomic events that affected the market and his firm. The idea of reflexivity is at the heart of this book. This reflexivity means that there is a two-way connection between events and the participants in that events influence the participants’ views, and the participants’ views influence the events. He also discusses how the expectation of rational behavior is unreasonable as investors won’t know all the alternative investment opportunities available at a particular point in time. So they will act on incomplete information.

For beginners or those not coming from a finance background, this book can be difficult to follow and understand. Highly rewarding for those coming from finance backgrounds.